Feds close file on Powers, Sweeney

By BRENDAN J. LYONS, Senior writer

Updated 12:54 am, Friday, November 18, 2011

Special to the Times Union by Alan Solomon -- From left, Senate Majority Leader Joe Bruno, State GOP chairman Bill Powers and Governor George Pataki at the Crowne Plaza hotel before the State Republican lucheon.
(ALAN SOLOMON)

Special to the Times Union by Alan Solomon -- From left, Senate...

TIMES UNION STAFF PHOTO BY SKIP DICKSTEIN - William Powers presented the new concept to the public at the presentation at North American Flight Service at the Saratoga County Airport in Milton, New York today November 19, 2007.
(SKIP DICKSTEIN)

TIMES UNION STAFF PHOTO BY SKIP DICKSTEIN - William Powers...

Times Union Photo by James Goolsby
Nov.1, 2006-Congressman John Sweeney and his wife, Gayle Sweeney. exit a home at 19 DeVincci St. in Clifton Park. To hold a press conference.
(JAMES GOOLSBY)

ALBANY -- The Justice Department will not pursue criminal charges related to an investigation of an Albany lobbying firm, Powers & Co., and former U.S. Rep. John Sweeney.

Records show the investigation had focused, in part, on Sweeney's relationship with the lobbying firm founded by former state Republican Chairman William D. Powers.

FBI agents examined Sweeney's dealings with Powers' firm as far back as 2001, when the then-second term Republican congressman secured a seat on the House's powerful Appropriations Committee.

The probe also explored the circumstances by which Powers gave Sweeney's former wife a job while the couple were still married and while Sweeney was in Congress. Gayle Sweeney left Powers' firm shortly after Sweeney's last term ended in December 2006. The couple later split up.

E. Stewart Jones, an attorney for Sweeney, said the Justice Department notified him recently that the investigation is over and no charges will be filed.

"The case is dead. They have made a decision not to prosecute and it's over," Jones said. "We have been informed orally that the matter is not going to be pursued."

The probe was conducted by the Justice Department's Public Integrity Section in Washington.

A spokeswoman for the agency declined to comment.

The investigation became public in June 2008 when FBI agents, armed with two federal search warrants, raided the downtown offices and storage annex of Powers & Co. On a Friday afternoon that month, special agents from Albany and Washington corralled workers into a conference room as they confiscated client lists, letters, files, cellphones, computers, notes, pictures, computer discs, credit card statements and lobbying records, according to a copy of search warrant materials.

The warrant identified items that would be seized to include "any thing of value paid to or received by Gayle Sweeney or John Sweeney ... (including) gifts, loans, offers of employment, contracts, billings, financial transactions, travel, tickets, souvenirs or photographs of sporting or entertainment events, or dining at restaurants."

Seth L. Rosenberg, an attorney for Powers, said his client has "at all times ... maintained his innocence of any wrongdoing."

"We applaud the Public Integrity Section of the U.S. Department of Justice for conducting a thorough investigation and coming to the conclusion that, in fact, Mr. Powers did nothing wrong," he added.

The House Appropriations committee and some of its congressional members were central in a broader investigation tied to former Washington lobbyist Jack A. Abramoff, 52, who served several years in federal prison for his conviction on felony counts of conspiracy, tax evasion and honest services fraud. Abramoff was released from prison last year stemming from federal convictions in both Florida and Washington, D.C.

A government memorandum on Abramoff, filed in U.S. District Court, outlined details of his cooperation and referenced Abramoff's use of all-expenses-paid trips to the Northern Mariana Islands in the South Pacific to gain favoritism with Washington lawmakers.

In October 2006, the Times Union reported Sweeney may have violated congressional ethics rules when he did not disclose who paid for a trip he took to the Mariana Islands with Tony Rudy, an Abramoff employee who became a lobbyist after leaving the staff of former House Majority Leader Tom DeLay.

Rudy pleaded guilty to federal conspiracy charges in March 2006 in connection with his lobbying work for Abramoff.

But court records related to the search of Powers' office indicate the materials seized from the Albany firm included information about a series of federal grants that were steered to Powers' clients.

Powers, 69, became a lobbyist after stepping down as state GOP chairman in 2001. He held the powerful position for 11 years. The list of federal lobbying clients at his firm have included the Lincoln Center for the Performing Arts, Siena College, and the Shaker Museum and Library near Powers' former home in Columbia County. The search warrant documents indicate federal agents seized numerous records from Powers' offices related to those three entities.

The Lincoln Center for the Performing Arts paid Powers' firm $180,000 a year in 2005 and 2006 during Sweeney's final two years in Congress.

The Shaker Museum received a grant from Sweeney while Powers represented the museum, according to a watchdog group and public records.

Siena College received federal transportation funding for improvements to its Loudonville campus. The college paid Powers at least $35,000 to represent it, according to state records.

Powers' firm had also helped Siena lobby for public funds when the college planned to expand across Route 9 into the property formerly used as the State Police's regional headquarters. In August 2008, FBI agents assigned to the Public Integrity Section visited the State Police's Troop G headquarters in Loudonville for undisclosed reasons.

Records show the private college received $240,240 for a perimeter road, part of earmarks totaling $1.3 million sponsored by U.S. Sen. Charles Schumer and former U.S. Sen. Hillary Rodham Clinton, as well as Sweeney.

Sweeney, R-Clifton Park, lost the November 2006 election to Kirsten Gillibrand, a Democrat who now is a U.S. senator.

Powers and Sweeney did not respond to requests for comment. They are longtime friends and Sweeney had been executive director of the state Republican Party when Powers ran the group.

Sweeney, a four-term Republican congressman, endured numerous scandals stemming from his brushes with the State Police. They included a DWI arrest, a 2005 domestic dispute with his wife that triggered a 911 call to police, and Sweeney's controversial car crash that knocked out power to a Washington County ski area nearly 10 years ago but resulted in no tickets.